An ICO is an Initial Coin Offering. QUOINE is drastically improving the ICO process by releasing a platform built to provide flexible and secure ICOs. This article will discuss the issues with the current state of ICOs and show how QUOINE is addressing these issues.
Some ICOs are great, some are lacklustre, and some are complete scams. Let’s have a look at what parts of the ICO process are frustrating – for customers and the hosts – and what QUOINE have done to improve this.
ICOs begin when a start-up attempts to raise funding for their project. Start-ups are able to offer their new token in exchange for a cryptocurrency, which is most often ETH. By doing this, the project can raise funding for development while bypassing the difficult task of gaining regulated funding through traditional methods, such as venture capitalists. The investors have the benefit of getting in early, with a large potential profit.
QUOINE have launched ‘ICO Mission Control’. This is a solution that will help blockchain projects conduct their ICOs in the best possible way, in terms of flexibility, security, transparency, and scalability. This will be achieved partly due to the strict know-your-customer (KYC) and anti-money-laundering (AML) policies implemented by QUOINE. These policies also directly improve the ICO experience and security for the investors. At the moment this will be part of QRYPTOS, however one the impending Liquid Platform is released, ICO mission control will become a part of that.
Currently, during an ICO, the start-up will accept cryptocurrency in exchange for their new token, and it is often offered at ‘a discount’, or with a % bonus which increases depending on how much you invest. This is in order to incentivise investors or backers. Of course, there is no guarantee that the token will be worth what was paid for once it hits the market, and there also is no guarantee that the project will continue development and meet the roadmap.
When a new start up is trying to attract investors into their ICO they have to clearly lay out why their project is worth backing. If the company does a good job they can attract thousands of potential investors who all want a piece.
People invest in ICOs in order to profit. There is no secret that investing in the correct ICOs can be exceptionally lucrative. Because of this, a lot of ICOs are now very hard to join – they sell out in seconds.
ICOs are first come, first serve – so often times people rush in to them without conducting the proper research that they might do on tradable cryptocurrencies. This puts the ICO developers at an advantage – people will invest based on little information. Furthermore, the project doesn’t have to have a proven track record of hitting milestones, all they need is a good idea, marketing and design. It has therefore become too easy for projects to ‘form’ and loosely state their plans and roadmap, before starting an ICO with a marketing campaign alongside, consequently raising an abhorrent amount of money. Once this is complete, the team disappears and then people start noticing the holes in the information provided. Of course, this isn’t every ICO – but it can happen.
For investors, getting access to ICOs can be hard due to the popularity and demand, and also it can just be annoying having the provide KYC every time. When you are sharing your details to lots of different companies, and when you don’t know the legitimacy of them, this is an issue. For example, DADI ICO had a data breach which led to people who had signed up for the ICO receiving phishing emails. This can potentially be very dangerous to ICO investors if their data is being leaked.
To combat this, you can use QUOINE’s ICO platform. QUOINE have strict security policies and a transparent team. Furthermore, you only have to provide KYC once – this is easier and also much less dangerous than providing KYC to many unknown companies. You can trust QUOINE with your data. They are JFSA certified and audited by one of the big four – meaning they are a legitimate, regulation abiding company with a great track record.
For ICO providers, QUOINE have a massive community of KYC approved customers who are willing to invest in ICOs. This is a great marketing tool, which will incentivise companies to host their ICOs through QUOINE’s platform. In terms of the difficulty investors encounter when investing in ICOs, this isn’t easily solved. ICOs will still be in high demand on QUOINE’s platform. However, one of the utilities of QASH in the future will be that holders will gain preferential treatment for ICO investing on this platform, which does help solve this problem.
Unfortunately, the massive ICO craze has introduced A LOT of very shady ICOs. Some of these projects appear with legitimate looking development plans, they raise the capital, and then they vanish. Some of these projects are also incredibly obvious scams – at least to seasoned investors. The issue is they still manage to collect a lot of money due to naive investors. ICOs are not regulated. Anyone can start one, raise the money, and then do whatever they want after it’s over. You can see how this might be an issue.
Just Google ICO scam and you will find plenty of examples. A lot of them are promoted by influencers in cryptocurrency, and some of them are promoted by famous people outside of crypto!
One great example of this is the Centra ICO. This ICO was promising financial services and big partnerships with companies such as Visa and Mastercard, but with no proof of the partnerships. This should be a red flag to investors, and these claims were proven to be false, of course.
This ICO was promoted by Floyd Mayweather Jr. and DJ Khaled – two massively influential people who are not involved in cryptocurrency. Centra ICO raised over $32 million. This just shows the potential a fake plan and a marketing campaign can have on ICO investors.
Therefore, at the moment investors must be very careful about which ICOs they are investing in. The aim for ICO mission control is not to stop people being careful with ICO investing, it is to provide an extra layer of security.
Millions were lost to ICO scams last year. On QUOINE’s ICO platform, each project will be thoroughly vetted to ensure it is legitimate. This helps to share the burden of research to make sure the project is legitimate. It is always encouraged to conduct your own extensive research before investing, however the approval of the project by QUOINE provides an extra welcomed layer of security.
Additionally, for any ICO happening on QUOINE’s platform, the hosts also have the ability to be fast tracked to secondary market trading on QRYPTOS. This is very appealing to both ICO hosts and investors. Investors often await the time the coins will become tradable and they can get their profits.
This is not financial advice, and the writer of this piece may or may not hold some of the mentioned tokens in the article. This was written for the QASH rewards programme.